Things to consider before you hire someone

Before you hire someone, there are a few things you need to work out, including:

the type of position/s you’re offering

the entitlements, including wages, that you’ll need to pay your employee/s

any paperwork you need to complete.

Employment type

When looking at the position/s you’re hiring someone for, it’s important to consider which employment type you need. Each type of employment can mean a different set of responsibilities for you and the person you employ.

Depending on your requirements for the role, you might consider employing a:

permanent (full-time or part-time) employee

casual employee

trainee or apprentice

temporary employee (possibly through an employment agency)

contractor (working for a fixed term and who have their own business).

Find out more:

When working out whether your worker is an employee or contractor, don't get caught out by common myths.

Video: Employee or contractor? Avoid the myths.

Recruiting

The right staff for your business will have the skills and knowledge you need to help you meet your business objectives.

You might be tempted to employ family or friends when you are starting a business. Before you do it’s important to consider if they’ll suit your business needs. Recruiting unsuitable staff can be costly, both financially and time-wise, which can be further complicated if you have an existing relationship with them.

Before you begin recruiting, you need to develop a job description of the type of worker you're looking for and the skills and knowledge they need to have.

You can recruit staff yourself, or you can use a recruitment agency. If you decide to use a recruitment agency, ask your colleagues and business partners to recommend a reputable one that has experience with your type of business.

The recruitment process

If you manage the recruitment process yourself, the steps to follow generally include:

advertise the job

evaluate the applications

conduct interviews and reference checks

select the best candidate.

Advertising the position

Before you advertise the position, think about the kind of worker you are looking for and the best way to target them, as well as any costs involved.

Superannuation

Superannuation (or ‘super’) is money you need to pay to a super fund for eligible employees and some contractors, to provide for their retirement. This is called super guarantee and it applies to full-time, part-time, and casual employees.

provide employee tax file numbers (TFNs) to their super fund within 14 days of receiving a TFN declaration form (or if you don't make contributions in those 14 days, you can provide the TFNs when you make the first contribution)

Induction training

When your employee first starts working for you, it’s important to think about how you can best prepare them for working in your business. Taking the time to prepare a good induction will help you get the best out of your employees. It’ll also make sure that your employee feels informed, welcomed and ready to do their job.

You may want to:

meet with your new employee to set goals and let them know your expectations

work out their training needs and how you will provide training for them during the first few weeks

schedule regular catch-ups to talk about how they’re going.

For more information on training employees, read our information on Training.

Video: Paying workers - Pay as you go (PAYG) withholding: Tax basics for small business

If the total amount of wages you pay exceeds a certain amount, you might also have to pay a payroll tax. Find out more on the Payroll Tax Australia website.

Report tax and super payments electronically

From 1 July 2019 you need to report payments made to employees directly to the ATO from your payroll solution at the same time you pay them. Payments include:

salaries and wages

pay as you go (PAYG) withholding

super information.

Find out more about Single Touch Payroll and what it means for different employers on the ATO website.

Employee health and safety

As a business owner you have legal responsibilities to set up health and safety practices in your workplace as soon as you start your business. You need to ensure that your business doesn't create health and safety problems for your employees, contractors, volunteers, visitors, customers or the public.

You must also take out workers’ compensation insurance to cover yourself and your employees.

Workers' compensation is a form of insurance payment to employees if they are injured at work or become sick due to their work.

Workers' compensation includes payments to employees to cover their:

wages while they're not fit for work

medical expenses and rehabilitation.

You may also need to have workers’ compensation to cover contractors who work for you.

Understanding the laws that apply to employees

There are workplace laws that apply to all employees in the national workplace relations system. Before hiring a new employee make sure that you know about your responsibilities under the Fair Work Act 2009.

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